This week will bring answers to questions that have hung over the market for months: Will slower growth in China put a dent in U.S. companies' income? Will new housing numbers come in strong enough to keep homebuilders flying high? How much did Superstorm Sandy cost insurers? Here's what to watch.

As the market breathes a sigh of relief on hopes that Europe isn't going to fall apart and the unemployment picture isn't getting worse, the focus shifts to China and earnings season. But earnings may be overshadowed if inflation data out of China is worse than expected, now that the country has the world's second largest economy.

And you thought we were dependent on foreign oil. China's nearly double-digit growth has become the envy of the world's mature economies, but all that expansion requires fuel. As a result, China is now a net importer not only of oil, but of coal as well. And the trends in Chinese energy consumption don't appear to be turning around anytime soon.

The Shanghai Composite is as close to a proxy for public firms in China as investors can get, and indexes are believed to reflect where markets think a nation's economy is headed. So what does it mean that, despite China's white-hot growth, the Shanghai Composite has been seriously lagging the S&P 500?

Investors piled into Chinese stocks after news broke that China's GDP surpassed Japan's for 2010, making the People's Republic the world's second largest economy after the U.S. The Shanghai Composite climbed 2.5% and in Hong Kong the Hang Seng gained 1.3%. In Japan the Nikkei 225 Index advanced 1.1%.

To quell its rapidly climbing prices, China has raised interest rates for the third time since October. But the signs are growing that it may not be able to keep the problem under control. And despite the economic threat from inflation, China isn't likely to let its currency rise.

The grandstanding is understandable enough for politicians facing an electorate battered by the Great Recession. But China's growth is fueling the strong results that companies continue to deliver. And China's global trade surplus has actually been shrinking.

China's decision to raise rates to contain food and housing price increases is a missed opportunity to move the country toward a more domestic-oriented economy. A higher yuan would slow exports, but it would be a bigger overall benefit to China's economy.

While the U.S. struggled with near-10% unemployment, China grew at that same pace over the past year. But the country faces massive internal problems that leave it in a far more difficult situation than the praise constantly heaped on it implies.

Chinese leaders say they will tighten monetary policy in 2011, a sign that authorities are increasingly concerned about rising inflation.
The Politburo decided that China%u2019s monetary policy should shift "from relatively loose to prudent next year," The New York Times said, citing a report in state news agency Xinhua.

Investors take note: Despite the calls for order, national policymakers are dealing with an increasingly haphazard scenario loaded with counterproductive results and unintended consequences. The result could be a slide toward protectionism.

One Chinese company that stands to benefit from China's boom is tiny and little known COGO Group, which provides some of the nuts-and-bolts components and expertise that local manufacturers need to produce high-performance and top-quality products.

With its economy growing rapidly even as much of the developed world struggles, tensions are mounting. China has recently crossed Japan and India, in addition to ongoing conflicts with the U.S. Fairly or not, China is being singled out as currency manipulator.

According to one China expert, overtaking Japan as the world's second-largest economy doesn't change the underlying economic issues China must resolve, but it does cement changes that have been rapidly making China a far more important player on the global stage

Plenty of good news may be getting overlooked in a market gripped by one form anxiety after another. That pervasive fear has investors crowding into government bonds. It could also create a good window to get into undervalued stocks.

China's currency climbed on Friday to its strongest level yet as the country's central bank set its daily official level to new highs against the dollar ahead of the G-20 summit. Beijing had vowed to let the currency fluctuate more, a move that was welcomed by many of the world's large economies.

With China's blistering growth and huge foreign reserves, Wall Street often cites the country in whatever sales lures it throws out for investors. But Beijing rarely cooperates with Wall Street's fantasies. (with video)

If you want to know what Beijing really believes about China's red-hot economy, its real estate market or the state of the global recovery, forget the numbers that the government can manipulate. Look at whether it allows China's currency to rise against the dollar.

While lots of U.S. companies complain about barriers to success in China, Son's edge is how he adapts to what I call the country's "entrepreneurial ecosystem." Plus, Softbank has capabilities that are ideal for Chinese markets now.